Ashley Madison CEO Resigns in Wake of Hack, News of Affairs

It’s been a month since news first broke that cheating site Ashley Madison was hacked. During that time Noel Biderman, CEO of the site’s parent company Avid Life Media, has remained confident in his company’s strength and endurance.

“Effective today, Noel Biderman, in mutual agreement with the company, is stepping down as Chief Executive Officer of Avid Life Media Inc, (ALM) and is no longer with the company,” the company said in a statement. “This change is in the best interest of the company and allows us to continue to provide support to our members and dedicated employees. We are steadfast in our commitment to our customer base.”

The statement didn’t indicate the sudden reason for Biderman’s departure, but it comes days after revelations of Biderman’s alleged infidelities.

Biderman founded the site, whose motto is “Life is short. Have an affair,” in 2001 and often referred to himself as the King of Infidelity. But despite encouraging other people to have affairs, Biderman, a married father with two young children, had long insisted that he had never cheated on his wife, nor did he want to.

But it turns out that Biderman may have been lying. At the time of that interview, the leaked emails suggest he may have already been engaging in a three-year sexual relationship with a Toronto escort who may have been paid for her favors.

Biderman apparently met the woman in 2012 at a spa. She emailed him in July 2012 identifying herself as “Melisa from the spa” and suggested they meet for coffee. Emails between them over the next two years depict a number of assignations at hotels.

The emails show it was the escort, who appears to have been a student at the time, finally broke off their arrangement in September 2014 after she became concerned that her boyfriend might find out.

“He’s very intuitive and almost found out last time,” the woman wrote Biderman in a September 2014 email leaked by the hackers. “I’m sorry. I don’t want to lose him. As much as I need the money. I talked to him this morning and my sense of guilt made me imagine that he knows.”

Biderman appears to have offered her a job with the company, writing her in October that “I will also have a good ‘signing bonus’ for you :).” The woman later declined the job, however.

The leaked emails also show Biderman discussing meetings with other women, including one identified as Mila who gave Biderman a phone number that matched a profile on TheEroticReview.com web site for an escort named Mila.

WIRED was unable to determine if the specific emails suggesting infidelity are legitimate, but they were released with other files that have been verified.

It’s not clear why Biderman would engage so boldly in revealing conversations through his work email account—instead of using a private account. Any system administrator working for the company would have been able to access his emails and view the conversations.

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Ashley Madison Says Its Business Is ‘Growing’

Then One/WIRED

Despite its recent hack, purported leak of customer information, and resignation of its chief executive, the parent company of Ashely Madison says business is going, well, just fine. In fact, it says, it’s “growing.”

“Recent media reports predicting the imminent demise of Ashley Madison are greatly exaggerated,” parent company Avid Life Media said in a statement on its site. “The company continues its day-to-day operations even as it deals with the theft of its private data by criminal hackers.”

And, according to the company, “this past week alone, hundreds of thousands of new users signed up for the Ashley Madison platform—including 87,596 women.” Don’t forget, the company says, we’re number one when it comes to “real people seeking discreet encounters.”

But Avid Life Media doesn’t stop there. It seems especially keen on responding to claims from journalists (including us) that there weren’t all that many women on the site—and certainly not active ones.

“Last week alone, women sent more than 2.8 million messages within our platform,” the company says. And in the first half of this year, it insists, site usage from male members compared with female ones was at a ratio of 1.2 to 1.

So, great. According to a company, people love that company. What else is new? And if you don’t believe it? Well, in place of proof, Avid Life Media ends its statement by adding, “We invite everyone to visit our website or our app and make up their own mind.”

Which, after all, may be exactly what’s happening. Although the site has been online since 2001, the Ashley Madison hack and subsequent data dumps have led to an enormous uptick in news stories about the site, and how people use it, in the past month.

This attention may mean more people are becoming aware of the site, leading to more sign-ups, engagement, and messages from those interested in, well, discreet encounters. But it’s also possible, of course, that people who have read about the site are signing up just to see what it’s all about. (In the past week, I’ve made two accounts, for example, to test out how it works for stories I’ve written.)

Either way, the company says its business is not at risk. And yet, for a business built on keeping users’ secrets private, Ashley Madison may have a little more to prove.

Ashley Madison Hit With $500 Million in Lawsuits

At least four lawsuits have been filed in the US against the cheating web site Ashley Madison, each of them battling it out for class-action status.

Two were filed this month in California, another one was filed in Texas, and a fourth was filed in July in Missouri. Another suit was filed last week in Canada, where Ashley Madison’s parent company Avid Life Media is based. That suit is being brought by a former Ashley Madison customer named Eliot Shore. Shore maintains that he briefly signed up with the site after his wife died of breast cancer but never met with anyone and never cheated on his wife. Shore is seeking $578 million in damages.

The US suits have all been filed by anonymous plaintiffs Jane Doe or John Doe, and allege that Ashley Madison and Avid Life Media are in breach of contract, engaged in negligence in protecting customer data and violated various state privacy laws. They say the companies knew their networks were insecure, an allegation that appears to be supported by internal documents and emails leaked by the Impact Team, the hackers who have taken responsibility for the breach. Internal discussions show that the Avid Life knew about vulnerabilities in their networks, including “technical issues that could lead to a data breach occurring, as well the legal problems that may come with that,” notes one of the lawsuits.

In addition, the Missouri suit states that its anonymous plaintiff paid a $19 fee to have Ashley Madison delete her personal information from its servers but failed to deliver on that service.

Courts will have to decide which of the US lawsuits gets class-action status, if any—which would mean that any other lawsuit filed against Ashley Madison alleging similar violations would be absorbed into that single case.

Military Investigated Ashley Madison Customer Over Adultery

Ashley Madison customers face a host of potential repercussions after hackers stole and leaked their data, from embarrassment to divorce to, in some cases, the loss of a job. The latter is particularly worrisome for employees of the US government caught accessing their Ashley Madison accounts from work computers and IP addresses. But members of the military could face another very real threat: a court-martial for adultery.

In fact, emails released by the Ashley Madison hackers show that a military prosecutor for the Marine Corps approached the cheating site in 2012 with a subpoena seeking information for an adultery case.

“As I informed you this morning, I am a prosecutor detailed to a court-martial involving adultery, which is criminalized in the United States Armed Forces,” 2nd Lt. Austin Booth wrote in an April 2012 email to Mike Dacks, general counsel for Avid Life Media, the parent company of Ashley Madison. “The accused Marine was an Ashley Madison customer. Through subpoena, we will request all relevant Ashley Madison account data, including but not limited to: profile information, billing history, uploaded or downloaded images, and private message activity with content.”

Booth was a trial lawyer at the Marine Corps Depot Law Center at Parris Island in South Carolina at the time and is now a prosecutor at the Marine Corps Base in Quantico, Virginia.

Adultery can be prosecuted as a crime under Article 134 of the Uniform Code of Military Justice, which prohibits conduct that could discredit the armed forces or is prejudicial to maintaining order and discipline. But this can be difficult to prove unless the adultery involved a commanding officer and enlisted personnel or it involved an affair between two other members of the military that has a negative impact on morale.

Dacks indicated in an email to ALM CEO Noel Biderman that he thought the company should fight the subpoena.

“I say we fight this and further we can make this a real ‘don’t ask don’t tell’ style issue (like gays),” Dacks wrote, linking to a website discussing the relevant military law.

He also indicated that the military request was a “novel request for us.”

Biderman replied that he was enthusiastic about the possibility of garnering some good public relations for the company by fighting the subpoena.

“Yes! Can we try to PR this?” he wrote.

A subsequent email from a company adviser asked Biderman if anyone had called the Marine Corps back to discuss the issue. Biderman replied, “Would rather talk about it offline—yes we called them.”

The leaked emails don’t reveal how the issue was resolved. Neither Ashley Madison nor Booth replied to requests for comment.